Durban construction company in multibillion-rand tender battle with road agency

Construction giant Aqua Transport and Plant Hire claims that the SA National Roads Agency (Sanral) deliberately blocked their bids for tenders worth billions, and had the road infrastructure agency gave those contracts to them, government would have saved R400 million.

Aqua instituted court action after Sanral’s board of directors banned them for six months and the three tenders, each worth about R1.5 billion, were subsequently awarded to Raubex Construction and Rumdel Construction. In December, they successfully interdicted the work from proceeding on the contracts and the trial is set to begin on May 21.

The contracts were for the upgrades of national roads across KwaZulu-Natal. Aqua wants Sanral’s tender awards set aside and their bids for the three contracts re-evaluated. Sanral, the two companies awarded the contracts and transport minister Fikile Mbalula are the respondents in the matter that will be heard in the Pietermaritzburg High Court.

The respondents have indicated their intention to oppose Aqua’s action. Ashwinkumar Bhagoo Bhikha, Aqua’s chief financial officer, said in the company’s founding affidavit, their ban was due to an alleged administrative flaw in the first contract that nullified the other two bids.

“We duly complied with protocols and completed Form A8 for all three tenders, with our bank details and attached a letter from Standard Bank,” he said. He said on December 11, 2019, Sanral demanded to be furnished with their bank letter’s, for the first contract, confirming their financial standing, as per Form A8, within 24-hours.

“We were threatened. Failing which, our offer would be rendered non-responsive. Sanral’s demand was substantially and procedurally flawed. If the bank letter rendered us non-responsive then we should have been rejected. Their demand ought to have been a request for clarification, but only 24 hours to respond to a clarification request is not a prerequisite,” he said.

An identical request was made for the third contract. Bhikha said the bank resolved the request within 24 hours but in error only submitted a letter for the third contract and not the first contract. This happened on the day Aqua closed for business, in keeping with the construction industry’s annual shutdown.

On March 24, 2020, Sanral requested an extension to the tender validity period for the first contract to September 18, and Aqua obliged. On May 6, Sanral’s bid evaluation committee confirmed Aqua’s offer for the first contract remained under evaluation, but said the bank letter was missing and warned that a six month ban could be imposed.

Aqua noted Sanral’s stance, and their director, Donovan Naicker, wrote to the entity and apologised for the inconvenience. On September 9, Sanral made a further extension to December 11 for the first contract, but on November 17, Aqua discovered on Sanral’s website that the contracts were already awarded.

Bhikha said they emailed Sanral stating they received no rejection letters for their respective bids. Sanral’s responded that that on October 18, their board of directors banned Aqua for six months. He said Aqua attempted gain further clarity on the decision, but were told the decision was final.

Therefore, Aqua approached the courts and were granted an urgent interdict and are now awaiting the start of the trial in the coming weeks. Smangele Nkambule, Sanral’s procurement manager, said her answering affidavit to Aqua’s court application was done in haste, but challenged their allegations.

“Papers were served on December 23 and the matter proceeded on December 30, but Sanral offices were closed from December 24 to January 4. We were prejudiced by not being afforded the opportunity to respond, so the matter must be dismissed,” she said. But Nkambule said should their claim of prejudice be disregarded, the matter should still be dismissed as Aqua, in its own founding affidavit, admitted to its own errors.

Jasper Cornelius van der Bijl, Raubex’s director, in his affidavit said Aqua had only themselves to blame for their predicament and the matter should be dismissed. Rumdel’s director Gunyaziwe Makaula echoed Sanral and Raubex’s standpoint that the case should be dismissed.